Vernon is a city five miles (8.0 km) south of downtown Los Angeles, California. The population was 112 at the 2010 United States Census, the smallest of any incorporated city in the state (and the nearest one to downtown Los Angeles).

The city is primarily composed of industrial areas and touts itself as "Exclusively Industrial." Meatpacking plants and warehouses are common. As of 2006, there were no parks.[5]

Vernon has a history of political problems, and was fighting disincorporation after city-government corruption was discovered.[6] California Assembly Speaker John A. Pérez has proposed legislation, AB46 to disincorporate cities with fewer than 150 residents.[7] Vernon is the only city that would be affected by the bill.[8]

According to an editorial in the April 26, 2011, edition of the Long Beach Press-Telegram, support to maintain Vernon's city status came from two powerful groups that were rarely allied: the business community (including the California, Los Angeles, and Vernon Chambers of Commerce) and the labor community (including the Los Angeles Federation of Labor and the Teamsters), joined together in the battle against Sacramento. Both groups acknowledged that Vernon needed a comprehensive political house cleaning, but both maintained its right to cityhood. The bill had passed in the Assembly on a bipartisan vote of 58-7.[9]

In the last few weeks of the legislative session of summer, 2011, a team of attorneys and lobbyists from Vernon were desperately trying to kill the bill that would disincorporate the scandal-tainted city when state Senator Kevin de Leon (D-Los Angeles) came to them with a creative and unconventional offer.[10] De Leon, who had earlier supported disbanding Vernon, said he would help to defeat the legislation if Vernon would set aside $60 million in order to fund community projects in the small, working-class cities that surround Vernon and to also agree to a proposed list of government reforms.[10]

Vernon agreed to the offer, and de Leon then proceeded to support the groups fighting disincorporation. City officials in nearby Huntington Park, which stood to receive some of Vernon's grant money, also reversed their support to the City of Vernon.[10] On August 29, the state Senate rejected the bill to disband Vernon.[11]

The Vernon City Council unanimously passed salary limits and other wide-ranging reforms on May 26, 2011, as the tiny Los Angeles suburb fought efforts to eliminate its cityhood.[dead link][12]

Associated Press reports that the council approved an amended package that cuts the salaries of council members from $70,000 to $25,000 a year, but not beginning until the end of their current terms. Other officials, including the police chief, also will see salaries trimmed, according to city spokesman Fred MacFarlane. Department heads salaries are now capped at $267,000. Previously, some city officials allegedly made more than $1 million to govern the city.[13]

The council also authorized benefit reductions for officials, established a city housing commission and voted to place a proposal on the city ballot that would change the city charter and limit council members to two, five-year terms. The city owns nearly all residential housing in town and there have been concerns that its officials are de facto landlords of the voters.

The city reforms are partially in response to the bill and were designed "to preclude the Legislature from imposing reforms from outside the city. The reforms take the city of Vernon a lot further toward a more open, transparent and inclusive governance structure," MacFarlane said. "The business community will have a role to play, as will representatives of labor, and those are two key constituencies."[13]

On August 2, 2011, Former state Attorney General John Van de Kamp, hired by the City to do an independent review of its policies, released a report that found “no significant fault” in Vernon’s compliance with the Political Reform Act, conflict of interest policies, the Brown Act, and the Public Records Act.[14]

In 2011, the Los Angeles District Attorney began consideration of a move to disincorporate the city. If this were to take effect, Vernon would be the third incorporated place to be disbanded in the past forty years, after Cabazon in 1972 and Hornitos, in 1973.[6]

In 2011, California State AssemblymanJohn Pérez submitted a bill to the California legislature which would have disincorporated Vernon as a city.[15] The allegations of rampant corruption prompted the state Assembly to approve California Assembly Speaker John A. Pérez's proposed legislation, AB46, to disincorporate cities with fewer than 150 residents.[7]

Disincorporation would make the city of Vernon an unincorporated area of Los Angeles County.

Gloria Molina, a member of the Los Angeles County Board of Supervisors, which has voted in support of disincorporating Vernon stated: it is a "company town masquerading as a city."[16] "The city has been a facade for some personal gain issues. The residents are employees of the city or major companies and consequently are controlled."[17] If the bill becomes law, Los Angeles County could and most certainly would absorb Vernon.[13]

"The issue here is about the complete lack of transparency and accountability in Vernon," Pérez said. "We cannot tolerate a situation where a handful of individuals are able to use an entire city as their own personal fiefdom."[18]

In May 2011, Vernon officials said they wanted Speaker Pérez to provide a $200,000 deposit before they would begin to fulfill a public-records request that he submitted as part of his proposal to disincorporate the city. The state Senate rejected the proposal on August 29.[11]

Vernon is the historic site where the Battle of La Mesa occurred on January 9, 1847, when Gen. Kearny again defeated a reinforced General Florés the day after the Battle of Rio San Gabriel. Accepting defeat General Florés fled southeast to Sonora, while Major Pico headed north into the San Gabriel Mountains with a hundred Californios. This ended hostilities in Alta California during the Mexican-American war, 1846–1848. At the end of the 1800s it was a stretch of unincorporated grassland near Los Angeles' flourishing downtown.[19]

In 1905, Vernon was incorporated by ranchers James J. and Thomas J. Furlong and John B. Leonis, a merchant.[20] Vernon was incorporated to promote industrial development along the railroads in the area. John Leonis, of Basque origin, had come to Southern California in 1880 to work for his Uncle Miguel Leonis and later established his own ranch on unincorporated county land southeast of Downtown Los Angeles. Recognizing the importance of the three major railroads running through the area, he persuaded railroad executives to run spur tracks off the main lines and incorporated the adjacent three miles as the first "exclusively industrial" city in the Southwestern United States. He named the new city after a dirt road, Vernon Avenue, crossing its center.

Leonis created an enticing attraction, leasing property to the founders of the city, for a baseball stadium, a 7,000-seat boxing arena and the "world's longest bar", 100 feet long with thirty-seven bartenders.[19] As industrialists from the East Coast traveled to Vernon for heavyweight matches, Leonis sold many of them on locating their West Coast factories in his village. By the 1930s Owens-Illinois, Studebaker, and Alcoa had opened there, purchasing subsidized electricity from the new utility, Vernon Light & Power.[19] When Leonis died in 1953, he left an estate reportedly worth $8 million, including several parcels of land, to his grandson Leonis. Leonis Malburg first won a council seat in 1956 and was elected mayor in 1974.[19] "Vernon has long been dogged by accusations that it is a fiefdom run by a family that has held sway over the town for generations."[21]

In 1907, on the land leased from Leonis, the founders of the city marketed Vernon as a "Sporting Town." Jack Doyle, an entrepreneur, opened the Vernon Avenue Arena, where 20-round world championship fights were held starting in 1908.[20] Shortly thereafter, the Pacific Coast League built a baseball park. The Vernon Tigers won three consecutive league pennants.[20] The Vernon Tigers, a minor league baseball team in the Pacific Coast League, played from 1909 through 1925.

The Poxon China Company was founded by George Wade Poxon (b. 1887, Castle Donington, Leicestershire, England) and his wife Judith (née Furlong) who in 1913 were married at St. Martha's Church in Vernon. The church had been built by the Furlong family in 1913. George Wade Poxon, a cousin of George Albert Wade (later Colonel Sir George Albert Wade), was well known as the chairman of Wade Potteries Limited in England, which produced Wade Whimsies. George Wade (b. about 1863 Tunstall, Staffordshire, father to George Albert Wade and uncle to George Wade Poxon) owned a pottery in Burslem, Staffordshire, England. The Wade family had been associated with the pottery industry for many years. George Wade Poxon was a member of the Royal Science Academy. At the age of 24, in 1911, he emigrated to the United States. The kilns were located on the Furlong ranch.

Vernon Kilns was founded in July 1931 after Faye G. Bennison purchased the Poxon China Company in Vernon, California. The Poxon China Company had its headquarters on 52nd Street, which is now part of Los Angeles. Bennison continued to produce Poxon lines, using Poxon shapes until an earthquake in 1933 forced Bennison to develop new and original shapes for the company. Two fires in the late 1940s almost brought the destruction of Vernon Potteries, Ltd., but Bennison decided to rebuild and the company continued to thrive. The company was not able to compete when a flood of foreign imports hit the American shelves and in 1958 Vernon Kilns sold all its holdings to Metlox. Metlox continued to market some Vernon shapes and patterns under the division Vernonware until 1989. The company produced dinnerware, art pottery, figurines, ashtrays and other popular items. All products were of earthenware, with clays from Tennessee, Kentucky, North Carolina, and England. Glazes were developed from minerals mined in California, and many patterns, including all of the plaids, were hand painted.

Vernon returned to being exclusively industrial around 1919. Two giant stockyards were opened and meat packing quickly became the city's main industry. Twenty-seven slaughterhouses eventually lined Vernon Avenue from Soto Street to Downey Road until the late 1960s.[20]

In 1932, after a dispute with Southern California Edison over industrial rates for electricity, John Leonis sponsored a bond measure to authorize the building of the city's own power plant, which is still operational today, providing the city with its notably lower utility rate.[20]

Unfortunately, due to mismanagement and bad decisions, Vernon has drastically increased the electricity rates charged to the industries operating within the city in an effort to fund the running of the city. As a result of this attempt to fund the city in large part from electricity purchased by industries located within the Vernon, there is an exodus of businesses out of the city.

The city held no contested elections from 1980 to 2006; The "Los Angeles Democrat" said city officials virtually "handpick their colleagues": Out of the five current City Council members, four were appointed, not elected by the voters.[6]

Most of the city's less than 90 voters are city employees or connected to city employees who live in homes rented at a nominal fee. In 1979 a firefighter tried to run for mayor and was immediately evicted and told he couldn't run. In 2006 a group of outsiders tried to move into Vernon and run for office. The city tried to cancel their registrations but was ordered to allow them to run and to count the ballots. Almost none of the city employees voted for them. Leonis Malburg, the mayor for fifty years, was convicted of voter fraud, conspiracy, and perjury in December 2009. In May 2011, the former city administrator Bruce Malkenhorst, Sr., accepted a plea deal for misappropriating $60,000 in public funds.[22]

In 2006, a controversy arose concerning a few people who moved into Vernon and ran for city council. This marked the first time in more than two decades that there was a competitive race for city council. In 2006, eight people converted a 1950s era office building into a five-room apartment (the building had previously been used as a tanning facility turning sheepskin into billiard/pool pockets), and three of them filed to run for office. The city responded by cutting off their power and moving to evict them as illegal squatters.[23] The City of Vernon alleged that the men were part of a hostile takeover attempt by convicted felon Albert Robles, who nearly bankrupted the nearby city of South Gate as treasurer and Eduardo Olivo a former Vernon attorney who also worked with Albert T. Robles, in South Gate.

On June 30, California Secretary of StateBruce McPherson called on the city to count the votes and expressed his support for the state to take over the responsibility of conducting the city's elections. During the trial it was alleged that all three of the newcomer candidates had direct ties to Albert T. Robles. Alejandro Lopez is a first cousin, David Johnson, Jr., is the brother-in-law of a business partner, Don A. Huff is associated through Eduardo Olivo. In March 2006, Judge David P. Yaffe ruled the city cannot prohibit legally registered voters who reside within its boundaries from running for city council. The city had to be ordered to allow the election to proceed. An election was held under a court order on April 11, 2006. But the city clerk, Bruce Malkenhorst, Jr., refused to count the ballots until the legal disputes were resolved and temporarily ordered the ballots to be sealed. In August 2006, Los Angeles Superior Court Judge Aurelio Munoz, ruled that the newcomers received free rent and jobs prior to registering to vote and that they were involved in a scheme orchestrated by Albert T. Robles and Eduardo Olivo to "steal" the election, but that such actions were not illegal. On October 16, 2006, it was announced that city officials were ready to count the votes from the contested April 11 election. The officials failed to prove their claim of voter fraud. A judge granted Vernon's motion to count the votes.

On November 15, 2006, the investigation into public corruption charges in Vernon resulted in charges being filed against the city's mayor, Leonis Malburg, as well as his wife, his son, and the former city administrator. The Los Angeles District Attorney's office had launched an investigation in April 2005 upon allegations that the city's former administrator, Bruce Malkenhorst, Sr., had misappropriated public funds for personal use.

Their investigation uncovered evidence of voter fraud on the part of the ruling family, which, it was asserted, tried to keep out new residents. Leonis Malburg, who has been mayor for 50 years, claimed he lived in a small Vernon apartment in the 2800 block of Leonis Boulevard (named after his grandfather, also a mayor), when in fact he was living in upscale Hancock Park, Los Angeles. His wife and son also claimed to live in Vernon, voting in Vernon elections though evidence indicated they too lived in Hancock Park. Charges against the Malburgs include voter fraud, assisting unqualified voters, false registration, and perjury.[16]

Malkenhorst Sr. was charged with 18 counts of "misappropriation of public funds" for reportedly taking $60,000 of city money for personal use. His salary from the city had been $600,000. Malkenhorst is still collecting his pension of $499,674.84.[24] In 2010, Malkenhorst received a reported $510,000 annual pension, plus health benefits, as former city administrator,[25] and is the number one person of the 9,111 retired California government workers receiving the highest pensions in excess of $100,000 from CalPERS.[24] Malkenhorst retired in 2005.[citation needed]

"With longstanding political woes, Vernon faced allegations of corruption similar to those in nearby cities such as the City of Bell. Although Vernon and Bell share a border in Southeast Los Angeles County, they are very different cities. Bell is a working-class, largely immigrant city with 38,000 residents. Vernon has fewer than 100 residents and is largely a business and industrial hub."[21] Vernon's City Official salaries once rivaled those of the city of Bell.[citation needed]

Expanding legal action against excessive salaries and pensions in two southeast Los Angeles County cities, (then) Attorney General Edmund G. Brown, Jr. had subpoenaed testimony from the city of Vernon. Brown's subpoena sought testimony under oath from Vernon officials about compensation and pension benefits for six highly paid city officials, one of whom received more than $1.6 million in a single year for the city.

According to media reports and other sources, Eric T. Fresch was paid $1.65 million in 2008. In 2009 O'Callaghan was paid $785,000, Burnett, $570,000, and Harrison, $800,000. Malkenhorst, Jr. was paid $290,000 in 2008. Malkenhorst, Sr., who also has been charged with misappropriation of public funds,[16] retired in 2005, and as a former employee, still receives a pension that is the highest in the state of California.[26] Malkenhorst, Sr. has been convicted of fraud and is under investigation for several other charges.[27] Malkenhorst pleaded guilty in May 2011 to illegally using public money to pay for personal items. Prosecutors said that from 2000 to 2005, he was illegally reimbursed for personal expenses that included meals, golfing, massages, a personal trainer and a home security system. He received three years' probation and was fined $35,000, including penalties. He was ordered to repay $60,000 in restitution.[28] He was fined $10,000 in addition to other penalties.[13] His total of $105,000 in fines will be no problem for Malkenhurst who continues to receive the highest public pension in California: $509,664. “The law states that pensions are revoked if an elected official is convicted of a felony, but not in the case of an employee,” said Brad Pacheco, a spokesman for CalPERS. Malkenhorst “would continue to receive his pension according to the law.”[29]

In September 2010, the Los Angeles Times reported that the inquiry follows the newspaper's report that the then-city administrator, Donal O'Callaghan received $243,898 in consulting payments through June 2010, through Tara Energy, Inc., the company run by his wife, Kimberly McBride. The payments were in addition to O'Callaghan's yearly salary of $380,000 for a total of well over half a million dollars.[30] He was accused of corruption for his role in obtaining city jobs for his wife.[13] O'Callaghan was indicted by a Los Angeles grand jury on three felony counts of conflict of interest and misappropriation of public funds. He has pleaded not guilty to two felony counts of conflict of interest involving contracts and one of public officer crime.[13]

The Los Angeles Times reported that Eric T. Fresch, the former Vernon city administrator, who now serves as a legal consultant, has passed the $1 million mark for the last four years. He was paid almost $1.65 million in salary and hourly billings in 2008, when he was serving as both city administrator and deputy city attorney.[31] Others in Vernon received $570,000 to $800,000 in 2009. Former City Attorney Jeffrey A. Harrison earned $800,000 in 2009 and City Treasurer/Finance Director Roirdan Burnett made $570,000. In 2008, Harrison was paid $1.04 million.[31]

In 2010, Malburg, the former mayor for fifty years, was ordered to pay more than $500,000 after being found guilty of fraud. Prosecutors stated he claimed to live in Vernon but actually had a home in the wealthy Hancock Park area of Los Angeles. Leonis Malburg and his wife, Dominica, were convicted of voter fraud and other charges.[13]

State Senator Tony Strickland (R-Moorpark) proposed a bill that would divest the pensions of any public official convicted of abusing public funds. The bill, SB115, was killed in a state Senate committee this month, with two Republicans voting for it and three Democrats against. The bill drew the ire of several employee groups, including the AFL-CIO, the California Professional Firefighters and the California State Employees Association. These groups and the lawmakers who voted against the bill contended that "it discriminated against public employees relative to private employees and said such a law would really harm innocent spouse and family of the convicted officer who will lose their financial security.”[29] Strickland stated he was “shocked” that the bill was killed. “State law affects judges and elected officials, but not people like Rizzo,” he said. “The argument about the family is a weak argument that can apply to any person convicted of a crime. Families are always affected when you talk about criminals.”[29]

Consisting almost entirely of warehouses and factories, the city's main industries are food service manufacturing, metalworking, and manufacture of glass and plastic equipment. Housing is owned by the city and its few residents are employed within the city limits. There are approximately 46,000 direct and 54,000 indirect mostly skilled workers employed by business within the City of Vernon.[32] Among the multitude of businesses is Bon Appetit Bakery, Papa Cantella's Sausages Company, F. Gaviña & Sons Inc, Farmer John Meat Packing and Simply Fresh Fruit,[33] whose products are highly visible in many supermarkets, convenience stores and service stations. True Religion, a designer of jeans and other apparel, is headquartered in Vernon. The city is also home to rendering plants, food processors, smelters and metal working companies. Vernon has a $4.5 billion private employer payroll.[34]

Vernon is primarily industrial, with few residents, and so has several singular city services. Vernon is one of 42 jurisdictions in the United States with a Class 1-rated fire department[35] and one of four cities in California with its own health department,[36] which specializes in industrial issues. It has a strong police force, municipally-owned housing for city employees, and a light and power department with rates which were at one time, up to 40% less than Southern California Edison and Los Angeles Department of Water and Power.[20] These services are designed for industry. Unfortunately, electricity and water rates are now some of the highest in the state due to new city council measures which are attempting to almost entirely fund Vernon from utilities paid by the industrial customers who have no voting power. As a result, many businesses are leaving Vernon for areas with more reasonable utilities. City employees and their relatives,[6] make up the majority of the residential sector and they hold the voting power. In 1989 Vernon formed a redevelopment agency, which has since invested millions of dollars to develop property within the city to successfully attract and retain business.[20]

In 2008, Vernon was named Los Angeles County's "Most Business Friendly City" for Cities with less than 50,000 residents by the Los Angeles County Economic Development Corporation.[20] Vernon produces a $250,000,000 flow of revenue every year, much of it from city-owned utilities.[8][38]

The Census reported that 112 people (100% of the population) lived in households, 0 (0%) lived in non-institutionalized group quarters, and 0 (0%) were institutionalized.

There were 28 households, out of which 10 (36%) had children under the age of 18 living in them, 13 (46%) were opposite-sex married couples living together, 3 (11%) had a female householder with no husband present, 6 (21%) had a male householder with no wife present. There were 1 (9%) unmarried opposite-sex partnerships, and 0 (0%) same-sex married couples or partnerships. 5 households (18%) were made up of individuals and 2 (7%) had someone living alone who was 65 years of age or older. The average household size was 4. There were 22 families (79% of all households); the average family size was 4.

The population was spread out with 21 people (19%) under the age of 18, 11 people (10%) aged 18 to 24, 36 people (32%) aged 25 to 44, 30 people (27%) aged 45 to 64, and 14 people (13%) who were 65 years of age or older. The median age was 36.5 years. For every 100 females there were 96.5 males. For every 100 females age 18 and over, there were 97.8 males.

There were 29 housing units at an average density of 5.6 per square mile (2.2/km²), of which 4 (14%) were owner-occupied, and 24 (86%) were occupied by renters. The homeowner vacancy rate was 0%; the rental vacancy rate was 4%. 10 people (9% of the population) lived in owner-occupied housing units and 102 people (91%) lived in rental housing units.

According to the 2010 United States Census, Vernon had a median household income of $32,188, with 18.6% of the population living below the federal poverty line.[43]

The median income for a household in the city was $62,000, and the median income for a family was $62,575. Males had a median income of $46,250 versus $33,750 for females. The per capita income for the city was $17,812. None of the population and none of the families were below the poverty line.

Many of the 112 residents of Vernon were city employees. Many lived in housing owned by the city government. As of 2006 about 44,000 people who work in Vernon daily live outside of Vernon.[5]